Opinion: In-Game Advertising Blows Up

As gamers know, product placement and advertising in popular media and games isn't a really new idea--it started to garner some attention as far back as 2001, with large companies sponsoring mini-games and Quake levels promoting phones. Still, despite some fuss about the idea, it had yet to catch on in a truly significant way. Gamers were still desperate for marketers to push products on them, but it seemed that it was not quite ready to materialize. How would they know what to buy? After the dotcom blowout, some people picked the idea back up and started to actually form companies dedicated to the concept--in-game ad firms Massive Incorporated and IGA Worldwide sprung up in 2002 and 2004, respectively, and major market research group Nielsen opened up an interactive division. Marketers even tried goofy stuff like allowing players to order pizza in EverQuest 2. By that point, the mass market had raised a few eyebrows. Articles started showing up from outlets like CNN and the Wall Street Journal, discussing the latest marketing shenanigans. As developers started to face the idea of their works of art being littered with whatever the ad guys could sell, they began to speak out a bit. Some were ahead of the game; in 1999, then-Gathering of Developers CEO Mike Wilson, now CEO of Gamecock, expressed a hope that in-game ads could be used to help fund rising development costs. There were even situations where companies were getting ads into games without developer or publisher consent. One such occurrence, involving a Subway ad campaign popping up in Counter-Strike, was quickly "resolved"--and, later that year, Valve and IGA inked an official in-game ad deal. Last year, Microsoft got in the mix by buying up Massive. Not to be outdone, Google, which currently dominates the existing internet ad market, acquired Adscape Media and filed a patent on in-game advertising and tracking technologies, refining the company's ability to be sure you, the gamer, get your personal taste-adjusted fix. Third-party publishers--including Activision, Electronic Arts, Take-Two, THQ, and more--have announced deals of their own, as research mounts claiming just how effective this all can be. So where is this all going? According to research firm Parks Associates, some $370 million was spent on in-game advertising in 2006--but that number is expected to climb to $2 billion by 2012. That puts the projected growth rate of in-game ads well over that of more traditional advertising mediums such as television and the internet. So, really, we're just now seeing the tip of the iceberg. By 2012, as we play through Belts of Conflict on our Xbox 1080s, there will be no question as to what our beverage of choice will be, or what kind of toilet paper we should use when we defecate in delight over all the amazing shiny things we can buy. Of course, through all of this, gamers have always hoped that the benefits gained from extra ad revenue would somehow be passed on via lower prices. Was anyone ever really buying this idea? It has yet to happen on any meaningful scale, though some developers have used post-launch content support as a justification for ads. In the end, the prevalence of ads will be determined by their effectiveness and by gamer acceptance--and for all the discussion and whining that goes on, there hasn't been much genuine resistance. Will the trend drop off over time, or will in-game advertising get more intrusive?